JLT Benefit Solutions, one of Britain’s largest pension consultants, has told its UK staff they are not getting a bonus for the year to December, even though trading profits rose 16% to £32.2 million.

In an internal memo to staff, its chief executive Mark Wood said: “Although our business performed well in 2013, we did not achieve the level of profit necessary to trigger bonus payments”.

A former JLT consultant commented that Wood had always said bonuses would be linked to meeting targets, rather than lifting profits. “People may not like the decision, but they shouldn’t be surprised,” he said. But he added the policy could result in defections.

However, the executive directors of the wider parent business all received bonuses, according to the company’s latest annual report.

A JLT spokeswoman declined to comment on defections and the contents of the memo.

JLT Benefit Solutions employs 2,000 people, mainly in the UK. The majority of professional staff are covered by the bonus scheme.

JLT’s share of the UK actuarial market was 11%, last year. Investment consulting margins are improving as it shifts from advisory business to higher-margin fiduciary work. Assets under management doubled to £1.5 billion in 2013.

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Wood said JLT Benefit Solutions fell £2.5 million short of its £34.8 million target last year, noting the acquisition of Alexander Forbes contributed nearly half of a £4.5 million profits increase.

In his memo, Wood added: “A disciplined adherence to targets is fundamental to our performance culture.”
Earlier this year, Peter Ball quit as head of investment consulting. His friends said JLT’s exacting targets were a factor behind his departure. Peter Breedon, formerly head of corporate consulting, has taken over Ball’s role.